Scottish Government procurement is bringing marketing agencies to their knees, argues Giles Moffat

Yesterday, John Swinney, Cabinet Secretary for Finance in the Scottish Government, unveiled what he termed his ‘stimulus budget’.

“In these difficult economic times this government is doing everything within its limited power to stimulate Scotland's economy.”

He has been saying this repeatedly since 2008.

Every time I read it, it rankles. For in that time, the Scottish Government has done nothing to stimulate growth in Scotland’s marketing services sector.

In fact, quite the opposite.

They have introduced unnecessary and toxic procurement processes that have brought many in the industry to their knees.

In 2009, the Scottish Government ‘appointed’ over 60 marketing services companies across seven different rosters.

How many of those companies have profited from their appointment during the last four years?

For most, it has been an appointment with disappointment.

For a few, it has meant the end of the road.

The reality is there simply isn’t enough work for even a tenth of the companies on these rosters.

Most of the work involved, perversely, is involved in trying to win something once you’re on the list. The Scottish Government has heaped huge pressure on suppliers through the ‘mini-competition’ process, where everyone now gets the chance to bid for every project.

No matter how small.

One of the worst examples was a mini-competition for a design project with a value of two thousand pounds. All ten agencies were invited to pitch. No budget was disclosed. Three pitched. All of them quoted well above the budget available, and the project was scrapped. A waste of time for all involved.

The Scottish Government – itself so keen on showing ROI for its activities - would do well to consider the economic cost of its procurement practices. Common sense calculation shows that for every £30k-£40k of fee income, the mini competitions cost our industry £216,000 – in other words, six times the value of the work.

Even some of the rosters themselves are completely superfluous.

In 2009 the Scottish Government appointed a roster of five highly capable direct marketing agencies. In five years, only two briefs have been issued, with average fees barely into double figures.

Now they have widened it even further, with specific rosters for subsets of marketing subsets like mobile marketing, SEO, segmentation.

How many companies will have put sweat and tears – and money - into getting onto the list, only to find that nothing comes of it?

the Scottish Government has ‘never supported as many marketing services suppliers as it does today.’

Dear Mr Swinney, for our sector, your budget is not the stimulus budget, it’s the exodus budget.

Since the Scottish Government started doing everything within its power to stimulate the Scottish economy, agencies have gone bust, good people (employers, agency heads) have moved to London, Scandinavia, Australia, and everyone who stayed behind is grumbling in private.

Which is a great shame, because the public sector in Scotland used to be one of the most enjoyable parts of the job. Good clients, clever people, compassionate and intellectually rewarding issues to get to grips with – now overshadowed by punitive and often nonsensical procurement processes.

Sadly, the reliance on public sector business in Scotland means that few have the courage to complain, even though they are seething in private.

Nielsen’s Agency survey in 2007, featured 10 Scottish agencies in the top 100. What you might expect given our share of population.

Now, there are only two.

Surely the Scottish Government’s ‘limited powers’ could stretch to scrapping this relentless and insensitive purchasing madness?

At the very least, Mr Swinney, please stop telling the world you are doing everything you can.

Giles Moffatt used to work in Scottish agencies, but left because of Procurement. He now pursues more Economically Advantageous activities elsewhere. He is also, unsurprisingly, a proud supporter of Better Together.